Overview of best prospect sectors, major infrastructure projects, significant government procurements and business opportunities.
Top prospect sectors for U.S. exports to Uganda include:
Oil & Gas
Uganda has approximately 1.4 billion barrels of economically recoverable oil. French firm TotalEnergies S.A. and the China National Offshore Oil Corporation (CNOOC) hold production licenses to develop Uganda’s oil reserves and the upstream partners reached Final Investment Decision in February 2022. In 2018, the U.S.-led Albertine Graben Refinery Consortium (AGRC) won a $3.5 billion bid to build and operate a refinery to produce petroleum products for domestic and regional markets. Due to the remote location and waxy nature of Uganda’s oil, the Lake Albert Oil Development Project includes the construction of the East African Crude Oil Pipeline (EACOP), the world’s longest heated pipeline (1,445 km), which will transport the oil to the Tanzanian port of Tanga for export. Additionally, the government aims to build production facilities, a storage terminal, and connecting pipelines. Furthermore, the government intends to build several hundred million dollars’ worth of highway projects to the oil region and is developing an airport in the same area. The Petroleum Authority of Uganda (PAU) estimates that, combining upstream, midstream, and downstream projects, plus support services, total investment to launch Uganda’s oil sector will reach $15 – $20 billion over the next five to seven years. Leading opportunities for U.S. investors include engineering, project management services, vocational training services, environmental hazard management services, and petroleum industry equipment exports.
While less than 20% have access to the electrical grid, at a national level 42% of Ugandans have access to electricity, with only 32% in rural areas (including off-grid). The government has aggressive plans to increase these electrification rates by constructing large- and small-scale power facilities. The 600 megawatt (MW) Karuma hydropower station is projected to be completed by June 2023, after a near three-year delay over infrastructure audit queries regarding the quality of the work of the contractor, China’s Sinohydro Corporation Limited. USAID’s Power Africa program and the U.S. government’s International Development Finance Corporation provide broad support to the Ugandan energy sector. Leading opportunities for U.S. investors include: exporting renewable energy equipment and services for on-grid, off-grid, and micro-grid applications; energy transmission and distribution projects; and engineering and environmental management services. 3Agriculture: Uganda boasts fertile soil, low-temperature variability, and two rainy seasons in most of the country, leading to multiple crop harvests per year. According to the Food and Agriculture Organization (FAO), Uganda’s fertile agricultural land has the potential to feed 200 million people. Agriculture accounted for 24.1% of GDP and 33% of export earnings in 2021 and employs over 68% of Uganda’s working population. Land tenure remains problematic, however, with many Ugandan farmers lacking clear land titles, hampering them from obtaining loans. Eighty percent of Uganda’s land is arable, but only 35% is under cultivation. Uganda produces a wide range of food products, including coffee, tea, sugar, livestock, fish, edible oils, cotton, plantains, corn, beans, cassava, sweet potatoes, millet, sorghum, and groundnuts. Leading opportunities for U.S. investors include equipment for value-added production of agricultural products, irrigation systems and their components, and provision of agriculture management services.
Uganda’s infrastructure needs remain substantial. The government is focused on building roads, especially roads to oil-producing areas. Uganda also faces an eight-million-unit housing shortage, according to the Uganda National Planning Authority. Leading opportunities for U.S. investors include architecture services, construction equipment sales, project management services, and environment management services.
Information and Communications Technology
Demand for information and communications technology (ICT) is high in Uganda. However, investors must grapple with a difficult regulatory environment, including taxes on imported internet-based services and applications. Leading opportunities for U.S. investors include building data centers, providing data security and internet services, and exporting telecommunications hardware, fiber optic equipment, and network hardware.
Uganda’s medical facilities remain underfunded and poorly managed, with the government dedicating 9.8% of the 2021/2022 total budget to the health sector. Uganda’s few public hospitals provide limited services. To fill the gap, several local and international investors have constructed private hospitals and dental clinics to serve wealthy and middle-class Ugandans, along with expatriates. While Uganda’s pharmaceutical industry has developed significantly over the past ten years, Uganda still imports 80% of its essential medicines and health supplies. Leading opportunities for U.S. investors include: the provision of pharmaceutical, medical diagnostic, and treatment equipment; and investing in pharmaceutical production and distribution facilities.